Letters to the Editor
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sorry, moira, you're wrong again....
"the real slap in the face is going to come when your housing value tanks, and you lose your job - and you can't get a home equity loan to pay for the healthcare that is no longer provided by your employer. And when, despite the lowered value of your house, your local taxes go up because the tax base has shrunk - and your local government doesn't cut services."
So if we don't bail out irresponsible homebuyers, the world as we know it will come to an end? Sorry, I'm not buying into your irrational fearmongering.
Our local taxes, school taxes, etc., like everybody else's, have ALREADY gone up because Bush has starved states and localities of funding to pay for his tax cuts to the wealthiest people in the country. But our house has, and will continue to, hold its value, as we were extremely prudent about where we bought, how much we paid, and how much we could afford. (Our mortgage was a whopping $132,000, about $80,000 of which is still outstanding.) And guess what? I have already lost my job -- my company closed down in June, and I don't start a new job until January -- and we have been paying for my insurance out of our savings, via COBRA.
And our credit is so ridiculously sound that Mr. Potter from "It's A Wonderful Life" would give us a home-equity loan.
My husband, our three kids and I have struggled through the same Bush-related insecurities as every other family we know. We, and most of the people we know, have done it by scrimping and saving, and without being financially irresponsible. Yes, the current housing crisis may drive the economy down a bit. But artificially inflating the value of homes, and rewarding the irresponsible, will do far more damage in the long run. As I mentioned in a previous post, I don't support the "pull up the bridge, I'm across" approach to housing, where prices stay artifically inflated to benefit the irresponsible and our kids can't afford homes.
As for those who support a bailout of people whose homes have lost value -- ie, people who have lost the gamble they never should have made in the first place -- do you people have 401Ks, mutual funds, or other investment assets? Then you have benefited from the deflation of the tech bubble, and the hardship it brought to those who bought into it, many of whom probably lost their homes. And unless you called your brokers at the time, and said, "Oh please, please, don't buy any of the stocks that other people bought at inflated prices," then you are a hyprocrite. You have benefited from the irresponsibility and the mistakes of others, and you have no call to pretend to be altruistic now.
The housing market, like any other market, is just that: a market with ups, downs, ebbs, and flows. Most of us consult an attorney, for a coupla hundred bucks, before we make the biggest financial commitment of our lives, especially if the welfare of our children hinges on our financial decisions. Those who gambled on the price of houses going up forever, or who were too irresponsible to read their mortgages, or who never should have bought houses in the first place, must face the consequences. As should any irresponsible lender who gave them loans in the first place.
I believe in personal altruism. Even while unemployed, I continued to give about 10% of my income, such as it was, based on freelance assignments, to charity. But the government, which represents society as a whole, must choose its altruism carefully, lest it reward the irresponsible at the expense of the rest of society. And yes, a bailout would affect taxpayers, as banks that froze interest rates would write off the losses and lower the tax base.